Asian Stocks were up overnight after the ECB introduced Quantitative Easing into the Euro-zone, furthermore we had good data from the Manufacturing PMI pushing up Asian stocks. Shanghai, was the only market that showed signs of weakness closing at (-0,16%). Tokyo reaches 1 year highs and closing at +1,05%, while the Toppix closing +0,99% at 1.403. All other Indices were positive, Seul +0,79% and Taiwan +1%.
Wall street moved higher on the back of the ECB Quantitative easing news which overshadowed negative local macro economic USA. Unemployment Claims came in at 307k vs 317k previous, but 301k expected.The Nasdaq composite closed +1,78%, Dow Jones +1,48% and the S&P 500 +1,53%.
European stocks also rallied after Draghi announced the purchase of €60 Billion bonds Monthly (Including negative yield bonds) until September 2016, with a minimum of around €1.1 trillion. This to stimulate the economy and promote inflation. The figure revealed was higher than what analysts expected and higher to an earlier figure leaked a few days ago of €50 Billion bonds Monthly buying from the ECB. The FTSE closed +1,02%, DAX +1,32%, CAC 40 +1,52%, IBEX 35 +1,70% and FTSE Mib +2,44%.
In currencies the Euro moves more than 2% in one session ahead, during and after the ECB announcement. Overnight EuroDollar dropped to a low of 1,1316 but still signs of weakness in the cross Euro/Dollar ranging at 1,133 to 1,1365. The Euro reached a low point of 1,1313, lowest level in 11 years since September 2003.
In commodities we saw Brent oil having a volatile session but prices remain flat on the day. Volatility was due to strengthening the USD after the ECB announcement taking off downward pressure and on the other hand the Weekly EIA report published yesterday showing an increase in output which reached it’s peak in 80 years. Overnight prices jumped after the news of the death of king of Saudi Kind Abdullah who will be succeeded by his brother Salman. This is a change in realm of the world’s biggest oil producing country, which shows element of uncertainty in the markets. This pushed Brent closer to the 50USD handle in march futures which was trading around 49,6 dollars a barrel.
Published yesterday on the EIA :
CRUDE +10,1 MLN (+2,6 MLN)
DISTILLED -3,3 MLN (+0,3 MLN)
GASOLINE +0,6 MLN (+1,2 MLN)